What to measure: ROI or KPIs?

Digital marketing is constantly evolving and rapidly changing. It's full of new technologies, new tactics, and new innovations. Yet there's one constant: accountability. There's an expectation that no matter how new, how cutting edge, how experimental or untested, it will all be perfectly measurable.

The reality is all digital marketing is and always will be measurable -- but not always along traditional lines. And you can't always measure what you most want to measure.

Analytics can reveal lots of insight, but there's a staunch unwillingness to accept (in some quarters) that the exact knowledge desired might well be akin to reading tea leaves rather than spreadsheets and dashboards. This leads to a world of unrealistic expectations and flat-out delusions. As I wrote earlier this year:

"Everything is measurable, but not necessarily right out of the box. That's why publisher metrics are applied to native advertising campaigns (though goals are widely divergent), and way too much stuff is measured in terms of "engagement," which means something different to everyone who utters the term. A trend I'd really like to see in 2014, in addition to all kinds of good metrics such as the ability to attribute ROI and measure accountably while aligning with goals, is a readiness to admit that it's just too early to apply hard-and-fast, unalterable metrics to brand new stuff we're all still trying to figure out."

Otherwise put, and very wisely so by Mashable's CMO Stacy Martinet in a talk last week, "There's a right metric for every campaign. But you have to figure out what it is, and you have to explain why to the boss."

The right metric isn't always ROI, but too often, ROI is the default, go-to metric to which marketers are being held accountable. Software manufacturers are under the same pressure. "How can we build ROI accountability into our dashboards?" is a question you hear over and over again in product meetings.

ROI is a wonderful thing. But it's not always possible to track every single effort down to a dollars-and-cents return. Often, it's not possible -- or even the most desirable outcome. It's also perfectly valid to have a goal of, say, message amplification in terms of social shares. If your YouTube video was shared 1.4 million times, that metric tells the right story.

Measuring message amplification (or brand metrics such as purchase intent, favorability, or consideration) isn't unrelated to ROI. All are steps along the journey -- critical steps, and even steps that can be assigned monetary value. Those 1.4 million shares can absolutely be measured monetarily if you, for example, crunched that number together with the amount of paid media that would have purchased an equivalent number of eyeballs.

Defining metrics is also essential. So you're measuring engagement? Fine. Just be able to explain what engagement actually is and what its value is as well. More often than not, "engagement" means something standard in analytics, such as "time spent on page." That might be worth something; it might not be. If you use it, justifying its value is part of the job.

When it's not possible to directly measure ROI, or even when it is, it's essential to develop key performance indicators (KPIs). There are dozens of possibilities for every campaign, every initiative, and every channel. Select ones that make sense. You're even allowed to change your mind later.

Only if you don't begin by measuring something -- something that makes sense as it relates to actual campaign goals -- you'll never make sense of those endless spreadsheets of data.

Rebecca Lieb has published more research on content marketing than anyone else in the field.
As a strategic adviser, her clients range from start-up to non-profits to Fortune 100 brands and regulated industries. She's worked with brands...